The story so far
On 23rd June 2016, the United Kingdom’s voting population decided by a narrow margin to leave the EU and go it alone. The World was in shock at this decision as politicians panicked and left their positions quicker than it took to mark that little cross in a box on the ballot paper in the first place.
The bill to trigger article 50, which we need to leave the EU, has been through legal challenges, media campaigns against the challenges and is going through both Houses of Parliament.
Whether the outcome of the historic vote is welcomed for you and your business or not, we are further on the way to it happening – and in our industry of storage, distribution and order fulfilment, this change could potentially be Yin and Yang moment.
The economy likes stability. UK companies could see a depletion in their exports due to a weakening pound and trade deals either not being favorable or not in place. This would lower the export order levels and ultimately what we send out internationally.
UK shoppers purchasing goods from overseas may slow as the pound drops as this makes international goods more expensive for UK consumers.
Any decline in overseas shipping could also push up the cost of courier rates as volume decreases, making the overall shipping for a purchase higher.
Larger UK companies could look to set up distribution networks in Europe, rather than shipping from here, keeping their costs much more competitive. This may bring greater opportunities down the line if you have the infrastructure in place to facilitate it.
The foreign companies who currently import all their goods on an individual basis may look to set up a distribution network within the UK, keeping their costs and import duties low. Foreign buyers could start to purchase more from the UK as the goods we have would be cheaper for them due to a weak pound.
Often the reality of developments are hard to predict as theories can pan out differently in practice- so the truth is that nobody really knows exactly what is going to happen.
Theoretically it’s still possible that Article 50 is not ever imposed, but there have already been clear changes in the economy as a result of the vote itself. The key is to stay engaged and know exactly what is happening so that you can react more quickly than your competitors.
If more international companies are looking to distribute it the UK- are you marketing for partners in that direction? If supply chain with Europe is more uncertain, are you looking for opportunities with the rest of the World? If one sector of your UK custom is slowing, can you diversity of look for new customers?
One thing which is for certain, is that this is no time to stand still.
These are just some quick thoughts of mine, as a Business Development Manager, working for a fulfilment company in the North of England. I’d be really interested if anyone has any perspectives to share on this – just get in touch at Vaughan.Bartlett@dmcdist.co.uk or through www.dmcdist.co.uk/